Trend Opportunity Profiles: Direct-to-Consumer (D2C) Business Model

Trend Opportunity Profiles: Direct-to-Consumer (D2C) Business Model

In 2020, 59% of customers preferred to shop online. Customers emerging from the COVID-19 pandemic expect seamless digital shopping experiences and direct interaction with brands. In fact, customers are more willing to switch to brands that offer complete transparency and accountability.

In the post-pandemic retail era defined by ease of access and personalization, direct-to-consumer (D2C) is emerging as a business model that offers end-to-end customer service without the need for traditional intermediaries. The eCommerce boom and the increasing demand for digital shopping experiences are driving the growth of digital-native brands and the shift to digital business models. In fact, social commerce and influencer marketing are emerging as two key factors contributing to successful customer outreach and retention.

Looking ahead, the deployment of emerging technologies, such as AR/VR, data analytics, chatbots, and blockchain, will drastically improve online customer experience and improve supply chain transparency. A strong data-driven strategy will emerge as the key solution to understanding customer behavior and offering a holistic customer experiences. Technologies will mature, become less expensive, and make it easy for new participants to penetrate the market and offer better customer experience. To create differentiation, brands will need to influence customer habits and find new ways to promote and sell their products.

This study explores the evolving customer journey across a wide range of online and offline D2C models, key drivers influencing growth, challenges that lie ahead, and major technologies that will drive innovation in this space. The convergence of transformational Mega Trends and disruptive technologies emerging from the new retail shift will result in new growth opportunities in this space, including social marketing and commerce integration, software-as-a-service (SaaS) platforms for supply chain management, and vertical integration to improve profit margins.

KEY ISSUES ADDRESSED

What are the key factors or indicators driving the direct-to-consumer (D2C) market?
What are the current unmet needs and challenges faced by D2C companies?
What is the scope for innovation and commercial advantage in this space over the next decade?
What are the key growth opportunities to watch out for in the next decade?
What best practices can companies seeking to enter this space learn from incumbent participants?